A Houghton luxury watch dealer who dodged of £1.25million of import VAT has been jailed for three years.
Darren Reay, 46, falsified import paperwork to show Rolex, Cartier and Breitling timepieces were worth as little as $50, describing them as low-value 'precision instruments'.
Reay, who traded online via eBay as Darren Reay Watches and also from Wight’s Watches in Cowes, Isle of Wight, used the money to fund a lavish lifestyle of luxury properties, cars and designer watches.
He was arrested on March 19, last year and more than 800 watches were seized from his then home, near Chilton Moor, after an investigation by HM Revenue and Customs (HMRC).
Reay, now of Tinkle Street, Grimoldby, Lincolnshire, admitted the fraudulent evasion of VAT totalling £1,252,948.20 , during a hearing at Teesside Crown Court, having paid import VAT of just £7,805 during a four-year fraud.
He was jailed for three years and the sale of the watches was ordered, with the proceeds paid to HMRC.
Colin Spinks, assistant director of the Fraud Investigation Service at HMRC, said: “Reay blatantly lied to steal £1.25m from the UK public.
"His crimes were driven by pure greed to fund a luxury lifestyle he couldn’t afford.
"We will ensure honest, hardworking businesses do not suffer from being undercut by fraudsters like Reay.
“HMRC will continue to pursue those criminals who attack the tax system.
"We ask anyone with information about suspected VAT fraud to contact our 24-hour Hotline on 0800 59 5000 and help us stamp it out.”
The investigation began after business records, including diaries, invoices, and shipping and courier documents, were examined as part of an HMRC compliance visit to Wight’s Watches in March 2014.
Documents showed insurance of $25,000 was taken out on shipments with declared import values of between $50 and $100.
HMRC investigations revealed that over 520 packages had been imported from one retailer in New Jersey, United States, with £6.3 million being paid out by money transfer in the same period.
Reay told investigators these watches were imported to order and he would receive commission. The offences took place between March 2011 and March 2015.
Darren Reay left the Isle of Wight in June 2014, but continued trading online through a business registered in Barnet, Greater London, while living in Houghton.